Since its establishment in 1999, the National Securities Commission of Georgia (NSCG) has been successful in reducing the volume and number of trades taking place outside the stock exchange. It has also taken important steps to increase transparency and...
See More +Since its establishment in 1999, the National Securities Commission of Georgia (NSCG) has been successful in reducing the volume and number of trades taking place outside the stock exchange. It has also taken important steps to increase transparency and disclosure. However, the assessment highlighted a series of weaknesses in Georgia's corporate governance regime and practices. Combined efforts are needed to strengthen shareholders rights, protect minority shareholders, improve disclosure and transparency, treat stakeholders fairly, and ensure that managing directors and supervisory board members abide by their duties and responsibilities. The reform program should include a component to strengthen the capacity of the NSCG, including its budget, human resources, skills, and powers of intervention. It is recommended that the NSCG establish a website to make information on publicly traded companies easily available. Efforts should also be made to strengthen the enterprise registers which hold important documents such as company charters. Such information should also be centralized and available online. It is necessary to strengthen the accounting and auditing profession to ensure the development of reliable audited financial reports. It is recommended to initiate a series of measures to increase the ownership of Georgia's corporate governance rules and regulations by issuers. One means of fulfilling this objective is through the preparation of a voluntary national code of best practice in corporate governance. Complementing this approach, an institute of directors should be set up to train corporate directors and disseminate best practice in board procedures.
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